I often come across news articles highlighting the arrival of new international retailers to Asia Pacific; with an influx of retailers and growth of store networks, I had often found myself wondering what factors are drawing retailers to the region.

In our recent retail report, “A Magnet for Retail”, we look at major underlying factors attracting retailers and also the presence of 100 top global brands, both luxury and mid-tier across AP.

Although each retail market has its own intricacies and appeal, there are drivers such as urbanisation, a growing middle class population and rising tourism that are influencing much of the region. In emerging Asia, rapid urbanisation is seeing 40 million more people living in cities each year and helping drive wealth creation.

Currently, AP accounts for around one-third of the world’s middle class population and this is projected to reach 46% (1.32 billion people) by 2020. Though staggering figures, this really just helps put in perspective the huge potential the region presents for retailers.

Rising income levels and greater ease in travel are also seeing more people go abroad, most notably Mainland Chinese. In 2013, an estimated 97 million Chinese tourists spent USD 129 billion on tourism abroad.

Aside from supporting retail sales, tourists are influencing local retail landscapes with their tastes and needs. I have certainly noticed such changes on my recent travels around Asia Pacific and even Canada, from hearing Mandarin spoken around me to having retailers accepting my UnionPay bank card.

The map below shows AP city rankings by retailer presence. Anyone who has ever walked through the streets or malls in Causeway Bay or Tsim Sha Tsui in Hong Kong can certainly understand Hong Kong’s position at the top of the list. These areas are adorned with an array of global retailers catering to all types of consumers.

Another interesting observation from the map is the subregional variation, with Greater China and North Asia generally having the highest presence of international retailers while Australia and India have the lowest.

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